Wis. business may leave state after losing contract with school districts

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MADISON (WITI) -- Skyward is a data-collection software program created in Stevens Point -- and utilized within school districts in the state. It allows parents and administrators to view detailed information about students -- including what they eat for lunch. Now, Skyward is looking to take its operation to Texas, after state lawmakers opened the contract up for other vendors -- and ultimately selected Skyward's competitor, a Minnesota-based company to provide this data-collection service. Skyward says the whole process was unfair -- as lawmakers defend their decision.

Lunch at Nicolet High School in Glendale involves pizza, pasta and pin numbers. There is no need for lunch money inside the Nicolet cafeteria, as students use a bar code on their student ID cards to pay.

As the items ring up, the student's photo and information about what they are eating appears on a screen in the cafeteria, and their homes if their parents want to make sure their children are making healthy choices.

"I, as a parent can go over to food service literally the minute after they go through that lunch line," one parent told FOX6 News.

In the office, using the same software, secretaries deal with attendance, health records, grades and more. It is a one-stop shop for student information -- a system called "Skyward."

This system allowed Nicolet to consolidate nine different computer programs into one software system.

Skyward is based in Stevens Point and was founded in 1980 by Jim King.

"Once a school district started to use our software, they would tell their friends, other school districts and it just mushroomed," King said.

Today, more than half of Wisconsin school districts use Skyward software, as do 1,400 other school districts in 18 states and five other countries.

"We've sold our software in China, we've sold it in Argentina. Isn't it ironic we can't sell it in Wisconsin?" King said.

That irony is turning into agony for the company's founder. Right now, each school district can find the best software for itself. However, in 2011, state officials changed that -- wanting to come up with a way for all of Wisconsin's public schools to have a uniform standard of collecting data.

"The Legislature and the governor with my support said in order to create the best efficiency and the best data system in the state of Wisconsin, we need to have a single vendor, go out and get a bid," State Superintendent Tony Evers said.

The theory was: the only way to measure academic achievement across the state was to have uniform reports from all of the school districts.

"It was really just to try to have a system that the state Department of Public Instruction (DPI) had to make an apples-to-apples comparison of student achievement across the state," Gov. Scott Walker said.

To achieve that, the state DPI, led by IT specialist Kurt Kiefer believed there needed to be just one student information system, and it would be awarded in a "winner-takes-all" kind of competition -- a request for proposal, known by the acronym "RFP."

"They based their decision on one system not having to talk to any other system," King said.

Therefore, Skyward, already in more than half of the state's school districts would have to compete for the same business all over again -- only this time, it wouldn't be the schools picking, but instead, a group of state "experts."

"That to me is a stab in the back to a Wisconsin company," King said.

This, despite the fact that King's customers were happy, as shown by Skywards 98% retention rate.

"The technical management at DPI created this problem for whatever reason. We think it was to eliminate Skyward from doing business in Wisconsin," King said.

Skyward sees a more sinister motive. It had captured business from schools that had once been a near monopoly of the CESAS (Cooperative Educational Service Agencies), which were founded to share staff and equipment between schools.

"We literally took their entire customer base and moved them under Skyward. It has ticked them off to the point where they will do anything to get rid of us. They can't beat us in the free open market," King said.

The open market is one thing, but the state Capitol is another. The state's Joint Finance Committee okayed the project, even after serious questions were raised by lawmakers.

"There's a lack of trust that a single vendor is going to be best for the taxpayer," Rep. Cory Mason (D - Racine) said.

Mason pointedly asked Kiefer why he was pushing a single vendor system.

The process was supposed to be open for any company to make a proposal, but documents show that in 2012, the Wisconsin Economic Development Corporation had attempted to steer the bid towards Skyward -- offering tax breaks, but the Governor's Office deemed that to be unfair.

Therefore, the RFP was restarted, with everyone on an even playing field -- or so it seemed. However, the idea of a single company handling all student information systems in Wisconsin was unsettling to conservatives like Rep. Robin Vos (R - Burlington). He has long advocated free market solutions.

"I do not see the benefit. If we can allocate the same cost, but give choices to every school district to say as long as you achieve the same results, I shouldn't care the path you take to get there," Vos said.

Vos wanted a multi-vendor approach that would have required all different companies to produce data in a uniform way. Vos asked for a vote to allow for multiple vendors, instead of a single vendor.

Yet, in a puzzling twist, all of the "free market" Republicans voted against Vos' wishes.

"It goes completely against the Republican platform, what Scott Walker stands for which is a free market economy: open for business, smaller government," Mike Weber, president and CEO of ISCorp said.

Meanwhile, King is more upset with the Republicans on the committee who he says backed away from their party's stated goal of letting competition dictate the winners and losers in the free market.

"I'd like to ask each one of them -- look 'em in the eye and ask 'em why they did this and why they continue to do this. Nobody has the common sense to stand up and say hold the phone. If nothing else, we are not going to create another monopoly in this state," King said.

However, that is just what the Legislature did. On February 1st, the contract was awarded to Infinite Campus -- a Minnesota-based company, and one of Skyward's competitors. Infinite Campus beat Skyward in the RFP process and was judged to be better technology at a lower price.

Now, more than two months after the bid was awarded to its rival, Skyward is raising questions about the integrity of the process. A FOX6 examination shows several irregularities, with the RFP's set of requirements broken in both directions, awarding points to Infinite Campus and taking them away from Skyward.

"It really comes to question -- the bias of the final five evaluators that were on the evaluation team that were allowed to change all of their scores even though the proposals didn't change," Weber said.

Through open records requests, FOX6 News discovered the RFP was initially scored in Skyward's favor, but (and it is unclear why), the same proposals were rejudged and the scored were essentially flipped.

"Skyward actually won the scoring by about 300 or 400 points. After the rescore happened, Skyward lost by over 1,400 points, so there was a swing of 1,700-1,800 points on a scale of 10,000 where the vendors actually changed positions," Weber said.

"Other things we noticed in the proposal is 73 times the selected vendor was scored higher than the maximum points allowed -- 73 times. 139 times Skyward was not given the minimum amount of points they deserved based on the rubrics associated to their evaluation process," King said.

A half-dozen phone calls to Infinite Campus went unreturned. The Department of Administration refuses to explain why that happened -- and the department operates under the authority of Scott Walker, who defends it.

"The process was set up to protect the public from people in office from picking people who are political allies or personal friends out there. What they said is you need to have an objective clear standard. They followed that," Gov. Walker said.

Weber founded ISCorp, which warehouses data for Skyward. He stands to lose nearly $1 million a year in the deal and did his own audit of what happened.

"In over 40 cases, Skyward didn't even get the minimum score for what they actually had, and that really started to trouble me," Weber said.

The question was why? Why would the Legislature award a state contract to an out-of-state company -- one that was more expensive and less secure, and one that had a track record of failure in Maine and other states? Especially when a Wisconsin company was already working well for half the state.

"They were duped. They were duped by Kurt Kiefer, when Kurt Kiefer is telling them all the great things about a single vendor -- telling them that all these other states are doing -- this was a lie. It was not debated by anybody with any technical background like myself or any of my staff. So these politicians, why would they doubt the head IT guy of the DPI?" King said.

Weber agrees that the evidence points to Kiefer.

"Certainly, Kurt Kiefer had an agenda. He had a preferred vendor. When he didn't get his result the first time around, they rescored," Weber said.

Before Kiefer became the Assistant State Superintendent, he was the superintendent of the Madison School District, where he had done business with Infinite Campus -- even appearing on the company's website, endorsing the product.

"In my opinion, Kurt Kiefer was still promoting the Infinite Campus product while he was Assistant Superintendent to the state of Wisconsin and while he was writing, constructing and editing his white papers for why Wisconsin should go to a single vendor. Again, the DPI basically chose because they controlled the RFP process," Weber said.

Evers is Kiefer's boss, and Evers defends Kiefer's actions.

"That was when he worked for the Madison School District. When he worked for us he wasn't advocating for any of it, and he wasn't part of the decision-making with the Dept. of Administration, so no. I don't think he influenced it at all," Evers said.

Kiefer argued passionately for the single vendor system before the Joint Finance Committee.

"It definitely to me looks like collusion. Certainly the person who has written all the white papers being Kurt Kiefer who is the Assistant Superintendent of the Department of Instruction -- he's the one who wrote all the facts of why it should go single vendor," Weber said.

King believes the process was rigged from the moment it started.

"He will deny he had anything to do with this. It's ludicrous. It's ridiculous. For him to be involved and literally heading up this selection process with his biases against us and for Infinite Campus is just, that in itself should just throw this whole thing out," King said.

Now, more than 200 school districts are facing a technology transition, and trying to find the money to do it.

"I don't get why we need to have a single system for the whole state, where the districts and the state are using the same system," John Reiels, the Technology Director at Nicolet High School said.

Reiles uses the analogy of department stores. Kohl's and T.J. Maxx may look different and operate differently on the retail floor, but in back, both have standardized loading docks, so trucks can move products in and out. That same idea, he says, could apply to data collection. Different companies, like Skyward and Infinite Campus could co-exist in the marketplace, and the state could take data through a uniform digital "loading dock."

It was just three years ago that Nicolet converted to Skyward, at a cost of $70,000. That whole investment would be lost.

More is at stake in Stevens Point, where Skyward employs 280 people. The company was planning to add a $20 million facility and 600 employees over 10 years.

"Our intent was to build a $20 million facility here in Stevens Point. Our roots are in Stevens Point. We want to stay in Stevens Point," King said.

Now, the company will almost certainly move to Texas.

"The consequence of this decision standing is number one: Jim King will lose all confidence in our political and administrative leadership in this state. The other consequence is Jim King will pick up and leave this state because if I can't sell my product in Wisconsin, I'd be a fool to stay in Wisconsin," King said.

Superintendent Evers denies any special favors. Gov. Walker says it was a DPI-led process, and he believes the process was "above-board."

"I do. The person who oversaw it, the third-party observer was a legal consult for Jim Doyle, a Democrat, so there's no political allegiance to us. She looked at the process as part of the review. They've added yet another third-party reviewer for that," Gov. Walker said.

Nearly a dozen phone calls to Minnesota-based Infinite Campus were not returned. Its chief operating officer is a former Republican staffer for a U.S. senator on Capitol Hill, who has faced ethics charges. He had also gone around Wisconsin giving presentations at Infinite Campus user meetings using cherished University of Wisconsin "Motion W" logo in a slide that read WTF, as he criticized Skyward.

"I wouldn't want that man in charge of every one of the school districts in Wisconsin. That to me is about as unprofessional as it gets," King said.

King has filed a protest with the DPI, but is still waiting for answers. This is the only answer he's getting from the state: "If I had a magic wand, I'd love to say let's keep it in Wisconsin" (Tony Evers).

"One of the questions going forward is, is this the way we're going to do it and are we going to have multiple vendors? That might be something to look at in the future as long as the data comparison is apples-to-apples," Gov. Walker said.

"I wish some politicians would have whatever it takes to stand up and say no. We are not going to allow this to happen. I don't think (Gov. Walker) could look me in the eye and say Wisconsin's open for business," King said.

"Would I prefer it to be a company from Wisconsin in this case? Absolutely. But, that's not what the rules are. That's not what the process is. We're obligated via the law to follow the objective measures that were laid out in advance of this," Gov. Walker said.